Can I Sue a Private Used Car Seller in Small Claims Court?

Yes, you can sue a private used car seller in your state's small claims court—as long as the amount you're asking the court to award for your losses (called "damages") is within the state's small claims dollar limit. In fact, lawsuits over private deals gone bad are among the most common small claims cases.

Here are the key takeaways. We expand on each of these points below.

• Most often, your claims will be for "breach of contract" or "breach of warranty." In some states and under some circumstances, you might also be able to sue for negligence or fraud.
• If you win, the court will try to give you what you bargained for, roughly speaking. This probably means the defendant (the party you're suing) has to pay the difference between what you paid for and the fair market value of what you got.
• Think about how you'll prove your claims. You must present evidence in court to establish each element of your claim and to justify the damages you ask the court to award.

Sample Facts

We'll use these facts as we talk about used vehicle small claims cases.

Barb bought a seven-year-old, used Chevy Impala from Jeff, a private seller. Jeff's online ad, which is how Barb learned of the car, said: "Used, seven-year-old Chevy Impala model SE for sale. Excellent condition—like new—only 36,000 miles. $11,000 firm. Call Jeff at (XXX) XXX-XXXX."

When Barb went to see the car, Jeff repeatedly said it had been a "great car," that it was "hardly used," and that he had another very interested potential buyer. Barb didn't notice anything wrong after a brief test drive. Fearing she might lose out, Barb quickly agreed with Jeff on a purchase price of $10,000.

After paying Jeff the money in cash, he gave Barb a "Bill of Sale" that said "On May 7, 2024, I sold Barb Doe a 2017 Chevy Impala model SE. VIN 2017DCG13TY467254. $10,000." Jeff also signed the back of the car's title and gave that to Barb. There was no contract or other documentation.

Within a short time after buying the car, Barb began to have problems. The engine was hard to start, ran unevenly, and burned lots of oil. The transmission regularly slipped out of gear. And the brakes began squeaking badly.

Barb took the auto to a reputable Chevy dealer, who told her it needed a complete engine overhaul, new brakes, and major transmission repairs. The work, according to the mechanic's written estimate, would cost Barb between $3,800 and $4,100. At the bottom of the estimate, the mechanic wrote "Car in bad shape. Based on condition of engine and transmission, I estimate it has at least 75,000 miles and maybe more. Looks like it might have been wrecked."

Barb ended up paying $3,975 for all the repair work. Before the work was done, Barb asked the dealer to give her a written estimate of the car's value. The dealer said the retail value was between $6,000 and $6,300. The Kelley Blue Book retail value was listed as $6,300.

Barb's Legal Claims Against Jeff

Barb's main claims against Jeff are for breach of contract and breach of warranty. She doesn't have much to go on in the way of a written agreement or other documentary proof. This lack of written evidence will make Barb's task more difficult, but not impossible.

What Can Barb Prove?

Barb can prove, through her own testimony, the online ad, and the bill of sale, that Jeff promised certain things about the car and its condition, including that it:

• had 36,000 miles
• was in "excellent condition" and was "like new," and
• was "hardly used."

Based again on her own testimony, as well as the written estimate letter from the mechanic, Barb can prove that the car:

• had "at least 75,000 miles and maybe more"
• "might have been wrecked" at some point in the past
• needed major, costly repairs to the engine, transmission, and brakes, to the tune of $3,975
• was "in bad shape," and
• before being repaired, had a retail market value of, at most, $6,300.

Other Evidence at the Trial

When the case is tried (heard in court), Barb should be prepared to say that she relied on Jeff's written and verbal statements and promises, and that she had no reason not to believe them as true.

When it's his turn, Jeff will say he told Barb he was selling the vehicle "as is," meaning he didn't make any other specific promises about its condition, its history, or how it would perform. But note, importantly, that an "as is" disclaimer won't negate specific promises a seller makes.

Jeff will probably say he had no problems with the car, and had no reason to think it would break down or need expensive repairs. He might confess to a bit of loose "sales talk," but will deny saying anything to deliberately mislead Barb. He'll probably deny any knowledge that the car had ever been wrecked.

What Are Barb's Damages?

Let's assume that after a hearing, the judge finds in favor of Barb, ruling that Jeff breached the contract between him and Barb. What damages will the court award her?

In general terms, breach of contract damages—called "compensatory damages" because they're meant to compensate for actual losses—are intended to give the injured party what they bargained for. Barb bargained for a used car with a market value of $10,000. She got a car with a pre-repair market value of $6,300.

In this case, there are two ways the judge might measure Barb's damages:

• the amount she paid for repairs, $3,975, or
• the $3,700 difference between the $10,000 used car Barb bargained for and what she actually got, a used car worth just $6,300.

In most cases, the fair market value damage calculation—$3,700—is the correct damages measure. A few states might award Barb what she paid for repairs. But here, practically speaking, the difference of just $275 is insignificant.

Finally, note that if Barb also had other losses, she might be awarded those as well. Suppose, for instance, that Barb had to pay for a rental car while the Chevy was being repaired. If she can show that Jeff expected or should have expected such consequences in the event of a breach, the judge might award Barb those damages, too.

Get Help With Your Private Used Car Sale Case

Small claims court is a good place to take a private used car sale dispute. The procedures are informal, and cases typically get resolved much faster than in regular court. Most often, you'll bring breach of contract and warranty claims. If you win, you'll get the benefit of your bargain, meaning the difference between what you bargained for and what you actually got. Be sure you can prove the elements of your case and all your damages.

If you need help preparing your case for small claims court, it might be a wise investment to buy an hour or two of time from an experienced lawyer. They know how to prepare a court case, the kinds of evidence you'll need, and how best to present your case to the judge.